Will Citigroup's Prudent Expense Management Support Performance?

Core Insights - Citigroup, Inc.'s CEO Jane Fraser is implementing a significant restructuring to improve performance and reduce costs, including a reduction in management layers from 13 to 8 [1][8] - The company plans to eliminate 20,000 jobs over the next two years as part of this restructuring effort [1] - Citigroup aims to achieve annualized savings of $2-2.5 billion by 2026, with expected expenses below $53.4 billion for 2025 [3][8] Company Restructuring - In June 2025, Citigroup will further reduce its technology workforce in China by approximately 3,500 employees as part of its simplification efforts [2] - The company has also consolidated its global real estate footprint in various locations, including the United States, Indonesia, the Philippines, and Poland [2] Financial Performance - Citigroup's expenses for 2024 were reported at $53.9 billion, with a target of reducing them to below $53.4 billion in 2025 [3] - The company's shares have increased by 13.1% year-to-date, outperforming the industry growth of 12.3% [6] Valuation and Earnings Estimates - Citigroup trades at a forward price-to-earnings (P/E) ratio of 9.50X, which is below the industry's average of 13.94X [9] - The Zacks Consensus Estimate indicates year-over-year earnings growth of 24.2% for 2025 and 24.8% for 2026, with recent revisions showing a downward adjustment for 2025 and an upward adjustment for 2026 [11]